FCC Chief Outlines Plans for VOIP

The nation’s top telephone regulator said Tuesday that he would call for the federal government -- not individual states -- to oversee the fast-growing technology that allows Internet phone calls.

Federal Communications Commission Chairman Michael K. Powell said that within two weeks he would propose an order declaring voice over Internet protocol an interstate service subject to federal regulation. And he plans to take a very light approach to VOIP.

Internet protocol, long used in long-distance traffic, has boomed this year in the consumer market as an inexpensive alternative to conventional phone service. The technology turns voice into data packets and sends it over high-speed Internet connections like e-mail.

Whether firms that sell the service should be as tightly regulated as traditional phone companies has been an issue of sharp debate. Backers of VOIP say too much regulation will stifle innovation. Phone companies and some state regulators counter that the same rules should apply because VOIP is just another way to make a phone call.

Powell’s comments to the Voice on the Net conference here expand on previous remarks about allowing new communications technologies to develop on their own with minimal government oversight.

“It is very likely that treatment of VOIP will have some of the farthest-reaching consequences of anything the commission will consider in the near future,” Powell said. “The commission is not simply considering minor adjustments to specific regulations -- the commission is considering the future of electronic and optic communications for many years to come. And we have to get this right.”

The first step, he said, is for the FCC to establish its authority over VOIP services and to halt state regulatory efforts before such efforts “dumb down the Internet to match the limited vision of government officials.”

Not all state regulators agree. But in California, Public Utilities Commission member Susan P. Kennedy has long advocated federal control of VOIP.

“Many regulators have protested change, saying that VOIP is just a different way to make a phone call,” Powell said. “But isn’t that the point? It is a different way, and it deserves a different regulatory structure that reflects its unique qualities.”

But many in the growing Internet phone industry believe that Powell’s policies have favored big regional telecommunications companies such as SBC Communications Inc. and Verizon Communications Inc. They fear Powell’s hands-off approach could allow the phone companies and the cable firms to use their control over the high-speed, or broadband, lines into homes to stifle competition from VOIP providers.

David Young, director of technology policy, said Verizon didn’t do anything to favor its services over its high-speed lines.

“Customers demand, and market conditions require, that we be neutral,” he said. “We offer VOIP services -- our new VoiceWing -- and that can go over other companies’ broadband. We certainly wouldn’t want that interference either.”

Powell assured the audience in Boston that network owners must allow content and programs from other companies to reach consumers freely.